The Grid was not really a first time but the way it was executed in Manhattan is a super lesson in history of urban planning. Panero says:

If the intelligence of a city can arise from the circuitry of its streets, then the street grid made a genius out of New York. In 1811, three state commissioners laid down Manhattan’s rectangular blocks. From First Street to 155th Street south to north and First Avenue to Twelfth Avenue east to west, their new grid obliterated the old lanes and farmhouses dotting the Manhattan countryside north of Houston Street, with few exceptions. Yet in trading away its past, the city built its future. The grid became the urban version of a super computer, a chipset to super-charge the city’s growth.

The bicentennial of the Commissioners’ Plan of 1811 devising the grid might have gone unnoticed if not for Hilary Ballon, a professor of urban studies and architecture at New York University. The exhibition she has organized at the Museum of the City of New York, “The Greatest Grid: The Master Plan of Manhattan 1811-2011,” running through July 15, gives the Commissioners’ Plan its due. “The street grid is a defining element of Manhattan, the city’s first great civic enterprise, and a vision of brazen ambition,” Ballon writes in her exhibition catalogue. “It is also a milestone in the history of city planning and sets a standard to think just as boldly about New York’s future.”

The Grid was a pretty flexible designThe Grid did not have any plans for parks etc. This led to development of famed Central Park:

Yet the grid also proved to be a more adaptable framework for urban design than is often assumed. “Although Manhattan’s grid may look rigid, it actually proved flexible,” Ballon observes. “The grid provided the city with an organizing principle—orthogonality—which could absorb modifications within its rectilinear structure.”

After the city failed to set aside several of the small parcels of green space planned in the original design, Central Park was neatly carved out between three avenues and, eventually, 51 blocks. The grid could also handle the occasional deviation. To attract development, Broadway was joined to the Upper West Side as a grand boulevard cutting diagonally across the grid and roughly following the old Bloomingdale Road. Morningside and Riverside parks were also added to work with existing topography, reintroducing variety into the residential grid. Madison and Lexington Avenues came later, designed as shorter blocks between Fifth, Fourth (Park), and Third Avenues. These avenues helped relieve some of the island’s north-south traffic; the commission had wrongly assumed that most of the island would be oriented crosstown, to the harbors on the Hudson and East Rivers.

As per Ballon it was a great govt intervention based on principles of capitalism.

the commission designed a city that could be bought, traded, and built on with the greatest utility. It created plots easy to subdivide and simple to develop, with blocks that could be broken up into 20- or 25-foot lots. By numbering rather than naming their avenues and streets, they also created a Cartesian order that didn’t inherently privilege certain plots over others—a trait “emblematic of the democratic society forged in the early republic,” writes Ballon. With “a framework that allowed individual property owners to make individual decisions,” the grid created a “dense, democratic, and relatively unhierarchical” city.

Though, there was some initial corruption as well:

Ballon is right to see the grid both as “an instrument of laissez-faire urbanism” and an “exemplar of planning” by strong government. Yet in carrying out its “multi-generational public works project,” New York also demonstrated how a machine government could undermine progress with corruption and graft. Boss Tweed’s Tammany Hall regularly manipulated the opening of roads so that political cronies could first buy up prime property, even reintroducing Broadway through midtown to create a luxury boulevard for insider speculation. The machine controlled both the estimation of property and the massive public-works project— at one time employing over 100,000 laborers—needed to grade the new roads.

Despite government predations, the grid proved to be a powerful machine of free-market capitalism. By announcing where future roads would go down, and by creating easily traded units of property, the grid forged the modern New York real-estate market. The land wealth it has generated since 1811 is astonishing. In 1807, the real estate of Manhattan Island had a total assessed tax value of $25 million. In 1887, it was $1.225 billion. In 2004, it was $169 billion (with Central Park valued at $1.9 billion).